What is the best way to budget/forecast?

Question

Just wondering who does this for their work and how they approach it. Do you think it is better to go low or go high with your numbers?

Answer 1

I think its good to go a little higher with your budget numbers. It gives your company a goal to reach, and especially to be able afford the expenses when they inevitably always rise the following year.

If you numbers from last year, the year before that, and the year before that, etc. are all over the board (hi, low, hi, low), it may not be a bad idea to start with "zero based budgeting".

Answer 2

First list all income. Then keep track of all outgoing cash to the penny for at least 1 whole month, make a list of all exspenses by priority(ie rent/mortgage,electric,water,food,phone ect) write the dollar amount beside each item subtacting from income untill each NEED is covered. Then prioritize the other bills(ie cable,cellphone,internet,cc's ect) and repeat. If you have $$ left at the end of both lists pay off highest inetrest nonsecured debt with remaining $$$. If no nosecured debit pay off car notes. If no car notes start "Contingency funds" to pay for non-regular items such as christmas/vacation/new roof/new car/ect with 1/2 money and place other 1/2 in intrest bearing savings account untill you have 10,000.00 in account then start investing with new savings. Listen to Dave Ramsey on the radio or online archives(free) at www.DaveRamsey.com (alot of free info some subscriber stuff)and check out www.debitproofliving.com (some free info some subscrition info)with mary hunt for more details and encouragment.
Bright Blessings
Athena